Oil Prices Edge Up to $90.96 as US-Iran Tensions Ease

Brent crude rose 0.3% to $93.30 a barrel and U.S. West Texas Intermediate recovered to $90.96, up 1% after a dip earlier in the day, as the latest round of U.S.–Iran skirmishes failed to shut down oil flows completely [1]. The modest rebound came even though the conflict has kept only five to ten tankers transiting the Strait of Hormuz each day, far below the pre‑war 130‑140 vessels that normally pass through the chokepoint [2].

The price lift reflects traders’ view that the immediate supply shock is limited. Frontline’s CEO Lars Barstad noted that five of the company’s tankers are stuck in the Persian Gulf, but he expects a “material increase” in traffic if the United States and Iran reach a stable security agreement, even though such a deal remains uncertain [2]. Meanwhile, the Joint Maritime Information Center only downgraded the threat level from “critical” to “severe,” signalling that attacks are still possible but less likely to halt shipping entirely [2].

Higher oil prices are feeding inflation concerns. A U.S. wholesale price report released Thursday showed May prices rising faster than economists expected, prompting the European Central Bank to become the first major central bank to raise rates this week [1]. The Fed is also slated to decide on rates next week, with market consensus leaning toward at least one hike by year‑end, adding pressure on equities and risk‑on assets [1].

The oil market’s modest gain underscores a delicate balance: while the conflict has not yet crippled supply, the lingering threat to Hormuz keeps traders cautious, and any escalation could quickly reverse the small price recovery. The key question now is whether diplomatic talks will produce a durable de‑escalation that allows tanker traffic to normalize, or if the region will remain in a “critical‑to‑severe” limbo that continues to cap oil price upside.